Western Union 2013 Annual Report Download - page 161

2013 FORM 10-K
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The Company has had discussions with the United States Federal Trade Commission (the "FTC") regarding the Company's
consumer protection and anti-fraud programs. On December 12, 2012, the Company received a Civil Investigative Demand ("CID")
from the FTC requesting that the Company produce (i) all documents relating to communications with the monitor appointed
pursuant to the agreement and settlement the Company entered into with the State of Arizona on February 11, 2010, including
information the Company provided to the monitor and any reports prepared by the monitor, and (ii) all documents relating to
complaints made to the Company by consumers anywhere in the world relating to fraud-induced money transfers since January
1, 2011. On April 15, 2013, the FTC filed a petition in the United States District Court for the Southern District of New York
requesting an order to compel production of the requested documents. On June 6, 2013, the Court granted in part and denied in
part the FTC's request. On August 14, 2013, the FTC filed a notice of appeal. On August 27, 2013, Western Union filed a notice
of cross-appeal. On February 21, 2014, the Company received another CID from the FTC requesting the production of all documents
relating to complaints made to the Company by or on behalf of consumers relating to fraud-induced money transfers that were
sent from or received in the United States since January 1, 2004, except for documents that were already produced to the FTC in
response to the first CID. The Company is unable to predict the outcome of this matter, or provide a range of loss, if any, which
could be associated with any possible claims that might be brought against the Company.
On March 20, 2012, the Company was served with a federal grand jury subpoena issued by the United States Attorney's Office
for the Central District of California ("USAO") seeking documents relating to Shen Zhou International ("US Shen Zhou"), a former
Western Union agent located in Monterey Park, California. The principal of US Shen Zhou was indicted in 2010 and in December
2013, pled guilty to one count of structuring international money transfers in violation of United States federal law in U.S. v. Zhi
He Wang (SA CR 10-196, C.D. Cal.). Concurrent with the government's service of the subpoena, the government notified the
Company that it is a target of an ongoing investigation into structuring and money laundering. Since March 20, 2012, the Company
has received additional subpoenas from the USAO seeking additional documents relating to US Shen Zhou, materials relating to
certain other former and current agents and other materials relating to the Company's anti-money laundering compliance policies
and procedures. The government has interviewed several current and former Western Union employees and has served grand jury
subpoenas seeking testimony from several current and former employees. The government's investigation is ongoing and the
Company may receive additional requests for information as part of the investigation. The Company continues to cooperate fully
with the government. The Company is unable to predict the outcome of the government's investigation, or the possible loss or
range of loss, if any, which could be associated with the resolution of any possible criminal charges or civil claims that may be
brought against the Company. Should such charges or claims be brought, the Company could face significant fines, damage awards
or regulatory consequences which could have a material adverse effect on the Company's business, financial condition and results
of operations.
In 2011, 2012 and 2013, Western Union received Civil Investigative Demands from certain state attorneys general who have
initiated an investigation into the adequacy of the Company's consumer protection efforts over the last several years. The Civil
Investigative Demands seek information and documents relating to money transfers sent from the United States to certain countries,
consumer fraud complaints that the Company has received and the Company's procedures to help identify and prevent fraudulent
transfers. Due to the stage of the investigation, the Company is unable to predict the outcome of the investigation, or the possible
loss or range of loss, if any, which could be associated with any possible civil claims that might be brought by one or more of the
states. Should such claims be brought, the Company could face significant fines, damage awards, or regulatory consequences, or
compulsory changes in our business practices, that could have a material adverse effect on our business, financial condition and
results of operations.
In addition, the Company is a party to a variety of other legal proceedings that arise in the normal course of our business.
While the results of these legal proceedings cannot be predicted with certainty, management believes that the final outcome of
these proceedings will not have a material adverse effect on the Company's results of operations or financial condition.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.